New Unemployment Claims Are Up For The First Time In 4 Months : Coronavirus Updates New claims for unemployment benefits rise to 1.4 million, a sign that the labor market is deteriorating as businesses close their doors again after the pandemic intensifies.

Job Picture Worsens: Millions More File For Unemployment, In Reversal

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RACHEL MARTIN, HOST:

And NPR's Jim Zarroli is with us because there are new jobs numbers out. And Jim, I do feel badly that...

JIM ZARROLI, BYLINE: (Laughter).

MARTIN: ...You are so often the bearer of bad news. But that's...

ZARROLI: Right.

MARTIN: ...Sort of just what we've got. And that's what we've got today, right?

ZARROLI: Yeah, yeah. We do have more bad news. I mean, the Labor Department says 1.4 million people filed unemployment claims for the first time during the week ending July 18, which is an increase of more than 100,000 over the week before. You know, in March, we saw this real historic spike in people filing for unemployment. One week, there were nearly 7 million new claims. Since then, we've seen the number of unemployed people falling for four months...

MARTIN: Right.

ZARROLI: ...Because states were relaxing their coronavirus restrictions and people were going back to work. This is the first time we've seen a reversal and an increase in the number of claims filed.

MARTIN: So is that it? It's just because, you know, people are realizing that maybe some of those reopenings happened too quick and they're shutting back down again?

ZARROLI: Yeah, I think it has everything to do with a recent spike in coronavirus cases. And one of the things that's been happening for months is that states were slowly relaxing their lockdown rules. But recently, we've seen, you know, cases increase in dozens of states across the country, especially in the Sunbelt - in places like Arizona, Florida, Texas, California.

So states have been forced to reimpose a lot of these restrictions. And a lot of the kinds of businesses that attract crowds of people, like restaurants and bars and retail stores, have been closing again to try to slow the spread of the virus. California, in particular, has gone back into lockdown. And it really saw a spike in claims last week. They were also up in Alabama, Tennessee, Louisiana - all states that are seeing more cases of the virus.

MARTIN: So I mean, I know, it's impossible to predict the future.

ZARROLI: Yeah.

MARTIN: But what do we take away from this? I mean, does this tell us anything about the jobs market going forward?

ZARROLI: Well, it is one week. And you know, maybe we shouldn't draw too many conclusions from it. It certainly suggests that the Labor Department has at least - you know, labor market recovery has at least stalled. And that's not a good sign. We're also seeing evidence that more and more businesses that had closed temporarily since March expect they're not going to reopen, and that's really worrisome. It means the slowdown that we've seen could be a lot harder to get out of and last much longer than we thought.

You know, what appears to have been a temporary slowdown could be much worse. We've seen - you know, look at what we've seen. We've seen big retail chains like J.C. Penney shut down. Today we saw Ann Taylor's parent company file for bankruptcy. Big airlines are warning they're going to have to furlough tens of thousands of people. Even the tech companies like LinkedIn are cutting jobs. And they've, you know, largely been protected and - before now.

MARTIN: Wow. So Congress is debating a fifth stimulus bill to deal...

ZARROLI: Yeah.

MARTIN: ...With all the effects of the coronavirus. And we're covering this elsewhere in the show, just what's going to go in that bill. But I imagine these new jobs numbers - I mean, this has got to be putting pressure on lawmakers to extend unemployment benefits, right?

ZARROLI: Yeah. I mean, one of the items of contention is this additional $600 a week that unemployed people get from the federal government. It's supposed to end on July 31. Republicans have said this encourages people not to work because they make more money on unemployment than if they had a job. But there's a lot of evidence it's kept families going. You know, there's research it's really kept poverty at bay. And...

MARTIN: Yeah.

ZARROLI: ...This is going to put pressure on Congress to consider extending them.

MARTIN: NPR's Jim Zarroli. Thanks, Jim.

ZARROLI: You're welcome.

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